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Upgrading the Filipino labor force for the int’ market
Rimaliza A. Opiña

TRAINING GROUND -- High-skilled workers stand to benefit most from the ASEAN integration. Here, the Benguet State University’’ bakery is not only an income generating asset of the university but has also become an avenue of learning for its staff workers and students, who regularly undergo internship programs to sharpen their skills and prepare them for bigger industries.
-- Ofelia Empian


Still feeling the economic setbacks as a result of the Asian economic crisis in the 1990s, six countries in Southeast Asia formed an alliance initially to strengthen its political presence in the world. The Philippines, along with Brunei Darussalam, Indonesia, Malaysia, Singapore, and Thailand comprised the founding members of the Association of Southeast Asian Nations (ASEAN).

Seeing its potential not just in the political arena, the ASEAN evolved by expanding its potential into the consumer market, hence the creation of the ASEAN Economic Cooperation (AEC). From the six-member organization, the ASEAN now includes Laos, Vietnam, Cambodia, and Myanmar.

The main purpose for the AEC, according to the National Economic Development Authority, is to accelerate economic growth, enhance trade development in the region, and allow the free movement of goods, services, skilled labor, and capital.

Patterned after the European Union and the United States Free Trade Agreement, the ASEAN is envisioned that by 2025, it shall have fully integrated and each member-nation shall have realized the benefits of liberalized policies especially in terms of trade, and by 2050, ASEAN is projected to be the third largest labor force in the world.

Last year was the banner year for the ASEAN for it signaled member-nations to work double time in order to realize of the vision of the AEC, which is anchored on four pillars: single market production base, competitive economic region, equitable economic development, and integration into the local economy.

The Philippines will be hosting this year’s ASEAN summit in June.

With a population of around 620 million as of 2012, the ASEAN is seen a major economic force next to China and India.

The Philippine agenda in the ASEAN

As a preparatory to the integration, major policy changes have been implemented in the Philippines since the creation of the AEC. The Philippines Development Plan, usually spanning six years, is anchored towards realizing the integration.

With a large labor base, the Philippines is investing on its human capital by strengthening its education system, hammering out policies that liberalize the entry of foreign labor into the country, and enhancing the skills of its current and future labor force.

Two years ago, the University of the Philippines, Ateneo de Manila University, and the University of Sto. Tomas changed their school calendar with the academic year beginning in August, no longer in June. Several universities followed suit, including those based in the Cordillera. UP College Baguio, Saint Louis University, and the University of Baguio including their elementary and secondary departments are now following a new academic calendar. The shift is not intended to “adjust” to the climate as widely perceived, but as part of the ASEAN integration.

The Philippines has also strengthened technical-vocational curriculum by adding courses that are needed not only in the local job market, but also in the international market.

Through the Technical Education and Skills Development Authority, a form of an accreditation system is being implemented by issuing national certificates for tech-voc graduates. These certificates may be added in the portfolio of a tech-voc graduate when seeking employment here or overseas.

The Department of Education is also implementing the K to 12 program where kindergarten is now mandatory before any pupil is allowed to enroll in grade 1. An additional two years was also added to the four-year secondary education. Only when a junior high school student finishes the additional two-years will they be able to call themselves “high school graduate.”

Courses under the senior high school program dwell on the academic, technical-vocational-livelihood, sports, and arts and design. These programs were all designed to prepare the current and future batch of students to work under an environment where they will not only be competing with fellow Filipinos in terms of skills and academic proficiency but with other workers from member-nations of the ASEAN.

“This highlights the need to improve the quality of upper secondary education and technical and vocational training in the Philippines to provide a smoother transition from the classroom to the workplace for the Filipino youth,” a study released in 2014 by the Asian Development Bank and the International Labour Organization showed.

Around three million additional jobs for the Philippines is expected with the integration.

This also explains why the Philippine Economic Zone Authority is presently conducting a nationwide roadshow enticing local government units to pass ordinances that would complement the PEZA Law – that is passing local laws giving additional incentives to economic zones.

Current incentives and privileges of PEZA locators are multiple entry visas to the Philippines, duty free importation, and zero value added tax for utility services such as telephone, power and water. These are apart from incentives given by LGUs such as in Davao City, which does not levy real property tax on locators for two years.

PEZA Director General Charito Plaza is also encouraging LGUs and private landowners to allow conversion of idle lots into economic zones. She said compared to local industries that could only employ a maximum of 3,000 jobs on the average, economic zones could generate as much as 30,000 jobs.

Plaza said more jobs create a domino effect and will greatly benefit the economy. “If people have jobs, they are given the purchasing power. In return, they pay more taxes, and businesses where they buy also pay more taxes and are able to hire more workers,” the PEZA director general said citing the principles of economics.

Plaza said Filipino workers stand to benefit most with the integration. She said investors prefer hiring Filipinos because of their proficiency in English, are adaptable, industrious, and have a high degree of work ethic.

The PEZA is targeting companies in the Middle East, Asia, and the Pacific to invest in the Philippines.

In the pipeline for the strengthening of eco-zones nationwide are the B2B or business-to-business matching – a partnership between local and foreign investors wherein materials or personnel needed in the manufacture of a certain product needed in one country will be matched with the demand of the investor.

Allowing the operation of more eco-zones could also be the answer to the massive labor migration. Plaza said with bigger compensations, the AEC might be the answer to the brain drain in the country. She said rather than work abroad, Filipinos might decide to work in the country.

Plaza said the PEZA is coordinating with the Department of Labor and Employment and human resource officers within eco-zone for the upgrading of wage and incentive packages for their workers. Although workers at eco-zones receive more than the prescribed wages in every region, she said the AEC has opened doors for member-nations to come up with a standardized salary package. “We are looking at health benefit packages, scholarship, and low-cost housing for employees at ecozones,” she said.

The current administration has also drafted an eight-point labor agenda that addresses issues both in the domestic and international front.

According to DOLE, the eight-point agenda ensures human resource development and promotion of a sound, stable, inclusive development, prosperity, and labor justice. These are:

•Enhance DOLE’s role as an institution;

•Address persistent problems of unemployment and underemployment, which include lack of employment opportunities, jobs mismatch, and limited access to the labor market;

•Ensure respect of labor standards and the fundamental rights at work;

•Continuously strengthen protection of OFWs;

•Give workers access to protection and welfare programs;

•Enhance collective bargaining and other forms of labor-management participation;

•Have a labor dispute resolution system that ensures just, expeditious, simplified resolution of labor disputes; and

•Have responsive and equitable labor law policies.

In November last year, NEDA also launched the “Ambisyon Natin 2040” program – a legal document containing the aspirations of every Filipino, culled from the answers of 10,000 respondents. The program, which spans four administrations beginning in the Duterte administration envisions an economically stable economy – its middle class having attained the aspiration of having decent housing, education, one car, health insurance, and being able to travel for leisure.

One of the goals of Ambisyon Natin is to be able to give decent and good paying jobs to our working population.

Pitfalls of going global

The rosy picture imagined in going “global” is not all rosy as it seems. According to the Kilusang Mayo Uno, the AEC is a big threat to the Filipino labor force.

Disputing the claim that the integration could somehow address the brain drain, Mike Cabangon of KMU-CAR regional secretariat said the integration only exacerbates labor exportation. He said labor exodus will continue because the stringent entry of foreign workers in other countries has been reduced, which entices more Filipinos to work abroad.

At the domestic front, this could mean displacement of workers because foreigners who have more skills could be given priority in the hiring process. Cabangon said brain drain is still a possibility because foreign companies that are able to offer higher compensation to local workers, talents, and professionals could “pirate” our pool of human resources.

At present, the entry of foreign workers either skilled or professionals is prohibited by Philippine laws if not granted a special permit to practice profession in the country.

While the AEC looks promising in terms of generating more jobs, Cabangon said liberalized movement of labor also exposes the country’s already fragile policies on labor. “The ASEAN integration makes the labor force more vulnerable.”

He said the bargaining power of workers, especially at eco-zones, is weakened by policies that they have to follow in order to remain employed, therefore tenurial rights are compromised. “Employees at eco-zones are barred from forming unions. How then could workers protect themselves when the government itself is protecting the investors?” Cabangon said referring to the incentives given to investors to convince them to put up their businesses in the Philippines.

He said opportunities spelled out the in AEC still gives premium to capitalism and neoliberalism – policies that cause-oriented groups such as the KMU have been opposing for decades now because of its tendency to sideline marginalized workers, micro and small business.

Benguet Electric Cooperative Human Resource Manager Delmar Cariño acknowledges that in order for the Philippines to be competitive under an integrated economic community, it should be able to address internal issues such as skills requirements and job qualifications.

“Under the AEC, the hiring process is no longer nationality-based but skills-based.” Cariño said the impact would come in two ways: for countries that are conscious about the implications of the integration, they embark on the continuing training of their people. Companies tie-up with internationally-accredited human resource organizations for the continuous upgrading of their workforce.

He said even the skills of employers are being upgraded to ensure that in the management and hiring process, they employ only the best workers.

Cariño said if member-nations do not adjust to the requirements of going global, they will be left behind in many aspects.

He agrees, labor export especially in the Philippines, will continue if Congress and Executive Department do not make moves to upgrade the knowledge and skills of the Filipino workforce. “We cannot retain the best workers if other countries could offer higher compensation for them,” he said.

Cariño said as early as now, Philippine companies should start reviewing their compensation packages. Congress on the other hand, must legislate laws aligned with the AEC at the same time protect the rights of Filipino workers from globally accepted hiring practices such as contractualization.

“Congress should pass laws that will harmonize present laws with the ASEAN, but should not also compromise the Labor Code.”

English proficiency and IT knowledge

He said this is also the time that every Filipino should be tech-savvy and proficient in English.

“Communication skills is very important and English is the internationally accepted language,” every citizen of a member-nation must be proficient,” Cariño said.

With the wide use of technology, Cariño also stressed that when upgrading skills, being knowledgeable in the use technology is a must.

“In the Philippines an IT section is a mere department. It should not be that way now. Every department must be tech-savvy.”

How gov’t should cope

According to the NEDA, the AEC indeed gives premium to skilled workers for they make up a large base of our human capital. Professionals, on the other hand, will be allowed to practice overseas, although initially, this is limited to seven professions. Through the Mutual Recognition of Professionals Agreement, those who could practice their professions are: those in the medical practice, engineers, nurses, accountants, dentists, surveyors, and architects.

Displacement was also anticipated but only a small percentage is said to be affected because Filipinos are known for being skilled workers.

Nonetheless, the NEDA has recommended strategies and safety nets to address these concerns, through:

•Skilled Occupational Shortage List – A list of occupations with short supply of local workers and where entry of foreign experts is crucial as identified by industry, labor groups, and the government.

•Philippine Qualifications Framework – A national policy that harmonizes that qualifications and procedures in employing foreign professionals in line with the ASEAN Qualifications Framework.

•Congressional action that liberalizes the entry of foreign professionals.

•Philippine Services Coalition – A multi-sectoral working group that would develop and implement a strategy for promoting Philippine services in the global market.
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Informatics College
King’ College of the Philippines
University of Baguio

Baguio Country Club
Benguet Electric Coooperative, Inc.
Department of Health – CAR
Department of Labor and Employment – CAR
Mayor Mauricio G. Domogan
Mayor Romeo K. Salda
National Grid Corporation of the Philippines
Philex Mining Corporation
Philippine Information Agency – CAR
Philippine Veterans Bank
Pines City Colleges
Saint Louis University
Sangguniang Panlalawigan of Benguet
Sangguniang Panlungsod ng Baguio

AHEAD Tutorial and Review
Assumption Medical and Diagnostic Center
Baguio Center Mall
Baguio Central University
Baguio Multicultural Institute
Baguio Water District
Bureau of Jail Management and Penology
C & AAA Supermart
Congressman Mark O. Go
Congressman Ronald M. Cosalan
Cordillera Kidney Specialists, Inc.
Cordillera School of Digital Arts
Department of Agriculture – CAR
Department of Environment and Natural Resources – CAR
Department of Public Works and Highways – CAR
Department of Trade and Industry – CAR
Department of Transportation – CAR
Dreamforce Review and Training Center
Fabulo Beauty and Image Salon
Far East Pacific Commercial
Filipino–Japanese Foundation of Northern Luzon, Inc.
FOX Visus Immigration Consultancy
GMS Technology
Lepanto Consolidated Mining Company
Mother Earth Deli Basket
National Telecommunications Commission
Overseas Workers Welfare Administration – CAR
R.A. Gapuz Review Center, Inc.
Regional Tripartite Wages and Productivity Board – CAR
Rianella Printing Press
Social Security System
Solibao – Ganza Restaurant


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